Hyundai Heavy Industries (HHI), the world’s biggest shipbuilder, today announced the consolidated financial results for the first quarter of 2015.

 

First-Quarter Consolidated Results (see note below)

 

The company’s sales declined 11.7 % quarter-on-quarter (QoQ) from 13.8461 trillion Korean won (hereafter “won”) to 12.2281 trillion won, due to a reduction in tonnage under construction and plummeting oil prices.

 

Operating loss widened QoQ to 192.4 billion won from 22.3 billion won due to the booking of 161.4 billion won in retirement bonus, cost overruns resulting from construction delays of special ships including semi-submersible rigs, and postponement in reaching agreement with clients on change orders pertaining to offshore projects such as Gorgon project. Net loss also expanded QoQ to 125.2 billion won from 37.9 billion won.

 

However, the Industrial Plant & Engineering Division turned profitable thanks to favorable change orders and the refinery business widened its profit thanks to robust refinery margin.

 

HHI attributes the increased loss in the first quarter to the one-off voluntary retirement payout and looks to further accelerate its drive to enhance efficiency and competitiveness with a greater focus on high-margin businesses.

 

■ First-Quarter Consolidated Results (Unit: Korean won)

 

                                       1Q15                       4Q14                   Change                    1Q14

          Sales              12.2281 trillion         13.8461 trillion              -11.7%               13.5208 trillion

 

 Operating Income       -192.4 billion             -22.3 billion                    -                      -188.9 billion

 

     Net Income            -125.2 billion             -37.9 billion                    -                       -91.0 billion